In Search of the Next Uber, SherpaVentures Raises $150 Million

SherpaVentures was founded by Scott Stanford (L), a former managing director at Goldman Sachs, and Shervin Pishevar, previously a managing director at Menlo Ventures

SherpaVentures

SherpaVentures, an investment firm founded by two early backers of car service Uber, has raised $150 million for its first fund in its quest to be a venture-capital firm less ordinary.

Founded by Shervin Pishevar, a former managing director of Menlo Ventures, and Scott Stanford, a former managing director of Goldman Sachs, Sherpa, in many ways, is representative of a new class of boutique firms: young, city-based, and striving to differentiate themselves from earlier generations.

Located in the heart of San Francisco’s downtown — many miles from the famed Sand Hill Road where many venture firms reside — Sherpa’s office of roughly a dozen employees is filled with plush Herman Miller chairs and black-and-white murals by local artists.

Mr. Pishevar is an Iranian immigrant and former tech entrepreneur who regularly hobnobs with the elite of Washington D.C. and Hollywood. Meanwhile, Mr. Stanford, who helped lead Goldman’s investments in Facebook and Uber, is part of a new wave of bankers turned techies. One of Sherpa’s anchor investors is TPG, a private equity firm that like several of its peers has recently become very active in venture investments, having led Uber’s funding round last year.

The co-founders bristle if you call SherpaVentures “another venture capital firm” — they call it an investment firm that is more akin to a concierge for entrepreneurs. Half of the group is an investment vehicle, SherpaVentures, and the other half is SherpaFoundry, a vehicle to incubate new companies and to connect their portfolio companies with larger, often public, companies.

“We felt like there was an opportunity to create a guild-like model,” says Stanford. “It’s our name. We like to be in the background making magic happen–hauling the bags up the mountain, enabling great success, the ones behind the camera at the summit.”

In its bid to be different, Sherpa is also part of a larger trend transforming venture-capital firms into full-service auto body shops. Many, including some of the largest such as Andreessen Horowitz and Google Ventures, now employ several specialists, such as designers and brand marketers, to help portfolio companies. It’s a way to do more than throw money at a startup– and more importantly, a way to stand out in a crowded field where even individual investors, through sites like AngelList, can write multi-million dollar checks.

Sherpa’s network of contacts is essentially made up of the Rolodexes of Stanford, Pishevar, and Tina Sharkey, the foundry’s CEO and a former Johnson & Johnson executive. Through them, it is possible to meet celebrities like Ed Norton or Olivia Munn to test out your service (both of which, not coincidentally, are Uber shareholders) or get a call with lawmakers. The foundry, meanwhile, exists, in part to help broker partnerships with big brands, according to Sharkey.

Sherpa’s model is heavily influenced by its co-founders’ most prominent investment: Uber.

Mr. Pishevar, through Menlo Ventures, led Uber’s Series B round of funding in 2011, which also included Goldman Sachs, led by Mr. Stanford. Separately, the men both assisted Uber with projects ranging from small to strange, from helping to recruit top executives to bringing in influential investors. Mr. Pishevar, for example, brought in a cadre of celebrity investors in the Series B round, including Mr. Norton, Ms. Munn, the musician Jay-Z, and actor Will Smith. In 2012, the two met in person at the All Things Digital conference, a conference formerly run by the Wall Street Journal. A year later, they decided to start Sherpa in the hopes that they could replicate their success with Uber with other companies.

The pair often speak of tasks in Uber-language. In discussing a job opening at one of their startups, Mr. Pishevar says they need a “Ryan Graves of Uber,” an executive at Uber who didn’t know anything about the market when he started but learned quick and is now the company’s head of operations.

In terms of thesis, Sherpa is looking in the consumer space and is stage agnostic – which means it could make a big investment at a later stage if the company was compelling. Asked whether Sherpa’s broad mandate and willingness to invest in at big valuations could lead to Sherpa overpaying for startups, Mr. Pishevar says he is impervious to such a notion.

“When I did the Uber deal at $290 million (valuation), I got a lot of that kind of feedback – we’ve seen how that worked out,” he says, referring to Uber’s latest $18.2 billion valuation.

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